CIMA Exam CIMAPRO19-P02-1 Topic 3 Question 81 Discussion

Actual exam question for CIMA's CIMAPRO19-P02-1 exam

Question #: 81
Topic #: 3

Endure Co. makes 1,000 units ofX and 2,000 units of Y.

Costs for X: Material $4, labour $8, direct overhead $2, fixed cost $4.

Costs for Y: Material $9, labour $9, direct overhead $4, fixed cost $6.

Selling price for X and Y are S19 and $25 respectively. Another company can sell ready made product X and product Y's to Endure Co, this company sells X at $12 and Y at $21. Advise Endure Co. on what would be the

most cost effective way to source products X and Y.

AEndure should buy X and Yfrom the other supplier.

BEndure should buy X but produce Y themselves.

CEndure should produce both X and Y themselves.

DEndure should buy Y but produce X themselves.

Show Suggested Answer

Suggested Answer: A

by Dulce at Feb 10, 2024, 04:33 AM

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7 months ago

I think it would be most cost effective for Endure Co. to produce both X and Y themselves.

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